Italy is facing a summer of strikes and industrial unrest after its new centre-left government unexpectedly announced bold measures to strip away layers of bureaucracy in business and open previously protected professions to competition.

The liberalisation package will affect the retail, pharmacy, public transport, insurance and legal sectors and is aimed at shaking up Italy's sluggish economy.

Consumer groups have applauded the measures which the Italian prime minister, Romano Prodi, called "a new beginning for the country and a change that will improve the lives of millions of Italians". But the industries affected have pledged to fight them.

Taxi drivers were the first to revolt, holding wildcat strikes in Rome, Milan and Turin at the weekend, inconveniencing thousands of Italians and tourists at airports and train stations. A national taxi strike has been set for July 11, while other sectors are threatening sit-ins and other forms of action.

Economic Development Minister Pierluigi Bersani's measures aim to deregulate once tightly controlled professions. Measures include non-prescription drugs such as aspirin being sold outside pharmacies, lawyers banned from imposing minimum fees for services, and people able to buy a used car, scooter or boat without having to pay a notary to approve the sale.

More taxi licences will be made available, a move expected to provide more jobs and lower fares. There will be no further limits to the number of bakeries allowed to open in any given neighbourhood and it will also be easier to open other types of shops and retail outlets. Councils will be allowed to decide if private firms can run local bus and other transport services and there are sweeping changes to the insurance industry.

Supporters say the new laws will cut the red tape that entangles many business transactions and will put consumers' interests first. The consumer association, Codacons, said the deregulation would mean average savings for Italians of up to €1,000 (£690) a year. Fearing industrial unrest could weaken government resolve, it wants the reforms driven through parliament with a confidence vote.

But there has also been fierce opposition. "We are all for liberalisation but not in this way," said Raffaele Morese, chairman of Italy's professional services association. He wants talks with the government to water down the deregulation, which he says will lower standards and promote "cowboy operators". Confcommercio, Italy's equivalent of the CBI, has also called for talks.

Some members of Mr Prodi's coalition government have expressed reservations, but while former prime minister Silvio Berlusconi has stayed silent, some colleagues have given their support.

Former agriculture minister Gianni Alemanno said the liberalisation was long overdue and his government should have confronted the problem when in power. Forza Italia politician Raffaele Costa agreed but said the Berlusconi government had feared alienating voters.